Acquiring Minds Podcast Summary: "How to Build a Niche Holdco with $2m in Earnings"

Release Date: April 24, 2025

Introduction

In the April 24, 2025 episode of Acquiring Minds, host Will Smith dives deep into the entrepreneurial journey of Matt Kopp, Managing Partner at Enduring Investment Partners. Matt shares his insights on building a niche holding company (HoldCo) with $2 million in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) by strategically acquiring businesses in the education sector within the Australian market.

Matt Kopp’s Entrepreneurial Journey

Matt began his acquisition journey in 2019 by purchasing Southern Biological, a supplier of organic samples for science classrooms. This initial acquisition generated approximately $350,000 in EBITDA on a steady $2.2 million in revenue. As Matt progressed, he expanded his portfolio to include similar businesses, ultimately scaling to a HoldCo that now manages a portfolio generating around $2 million in EBITDA with established management teams in place.

Matt Kopp [00:42]: "A good solid little business."

Strategic Acquisitions and Building a Portfolio

Matt's strategy focused on identifying businesses within the education sector that provided reliable demand due to consistent school budgets for educational resources. By targeting niche markets, such as organic science supplies, he ensured steady cash flow and minimized market volatility.

Dealing with Overstaffing and Cost Efficiency

One of Matt's key themes is his willingness to streamline operations by letting go of unnecessary staff to enhance efficiency. Unlike the typical entrepreneurial approach that emphasizes employee retention, Matt prioritized operational excellence and cost management.

Will Smith [01:20]: "In a target business, not cutting them."

Matt explains how reducing staff from 12 to 5 in Southern Biological led to significant cost savings and improved EBITDA from $350,000 to $650,000 within the first year post-acquisition.

Navigating the Australian Market: Challenges and Opportunities

The Australian acquisition market presents unique challenges, including lower business multiples and limited access to debt compared to the U.S. market. Matt highlights the importance of understanding local market dynamics and leveraging personal outreach over traditional business brokers to secure acquisitions.

Matt Kopp [29:55]: "Extremely difficult. So the bank debt that I got was actually supported by a mortgage to sort of get into the deal."

Acquisition Strategies: Organic and Inorganic Growth

Matt emphasizes a dual approach to growth—organic improvements within existing businesses and strategic inorganic acquisitions. During the COVID-19 pandemic, Matt capitalized on discounted acquisition prices to expand his portfolio swiftly.

Walker's Insight [57:55]: "I was trying to leverage access to customers and cross-sell services within the education sector."

Impact of COVID-19 on Business Operations

The pandemic posed significant challenges, including prolonged lockdowns that affected revenue streams. However, Matt's strategic foresight in maintaining cash flow and implementing remote work systems allowed his businesses to weather the storm effectively.

Matt Kopp [49:43]: "Working from home became a possibility probably for the first time this company ever."

Transition to Investor Role and Establishing Enduring Investment Partners

As Matt's portfolio grew, his role evolved from hands-on operator to strategic investor. Recognizing the potential for leveraging his success, Matt co-founded Enduring Investment Partners, a private equity firm focused on supporting new acquisition entrepreneurs through a search model.

Walker Deibel [104:23]: "Enduring Investment Partners is what we've just set up. And we're looking at finding four CEOs for the Australian market under a similar type of search model."

Notable Quotes

• Will Smith [00:47]: "After six years of Matt running hard, today Matt's businesses run themselves."

• Matt Kopp [33:35]: "I was dealing with a couple of different fronts as we were going through that process."

• Walker Deibel [44:23]: "I went in with a very probably arrogant approach to sort of small business where I thought that, you know, I've got this really great business and for me the business was the brand, the product, and its customers."

• Matt Kopp [63:54]: "It was challenging, but it was... a lot of luck or just being in the right place at the right time."

• Walker Deibel [101:25]: "Enduring Investment is a first-of-its-kind incubator in the Australian market, similar to US and European models."

Conclusion

Matt Kopp's journey underscores the potential of acquisition entrepreneurship within a niche market. By strategically acquiring and streamlining businesses, navigating market-specific challenges, and leveraging both organic and inorganic growth strategies, Matt successfully built a robust HoldCo with $2 million in EBITDA. His transition to establishing Enduring Investment Partners highlights the scalability of his model and his commitment to fostering the next generation of acquisition entrepreneurs in Australia.

For listeners interested in buying businesses and learning from successful entrepreneurs, Matt's story offers valuable lessons on strategic acquisitions, operational efficiency, and market navigation.

Additional Resources

• YouTube Channel: Acquiring Minds
• Episode Summaries: Sign Up Here
• Enduring Investment Partners: Enduring Investment (Note: Replace with actual link if available)